Paramount Global shares are up 7% during Wednesday’s trading session following news on Tuesday that David Ellison’s Skydance Media and Shari Redstone’s National Amusements have reached a tentative agreement.
The deal has been referred to the Paramount board’s independent special committee for review. An individual familiar with the matter told TheWrap that the deal could potentially be completed as early as the weekend.
Representatives for Paramount, National Amusements and Skydance declined to comment.
Under the latest deal terms, Ellison’s Skydance would pay $1.75 billion in cash to Redstone to acquire NAI before merging with the Hollywood studio. The deal also includes a 45-day go-shop provision that gives other bidders the opportunity to make a better offer.
Others who have expressed interest in acquiring control of Paramount in recent weeks include IAC chairman Barry Diller, “Baby Geniuses” producer Steven Paul and former Warner Music Group CEO and chairman Edgar Bronfman Jr. Sony Pictures Entertainment and Apollo Global Management submitted a$26 billion all cash offer in May, and Allen Media Group founder Byron Allen placed a $30 billion bid including debt. Warner Bros. Discovery CEO David Zaslav also met with former Paramount CEO Bob Bakish about a potential merger in December, though those talks were later halted.
Additionally, CNBC’s David Faber reports that National Amusements would be given $100 million, while another $100 million would be set aside for indemnification. Skydance also reportedly still plans to acquire 50% of Paramount Class B shares for $15 apiece.
The new deal comes after Redstone scrapped an initial two-step deal with Ellison last month. That deal has been opposed by the company’s minority shareholders, who argued it prioritized Redstone at the expense of the rest of Paramount’s investors.
While both sides agreed to the economic terms of the deal, there were outstanding issues they did not agree on — most notably, giving all shareholders a consent vote on the sale. The latest deal will not include a shareholder vote.
In the meantime, Paramount is currently being run by its new co-CEOs Brian Robbins, George Cheeks and Chris McCarthy, who replaced Bakish in April. The trio unveiled a long-term strategy last month that includes streaming partnerships, divesting assets and $500 million in cost cuts in areas including legal and corporate marketing.
At an employee town hall last week, the executives said they’ve hired bankers to help with asset sales. Earlier Tuesday, Paramount shares rose on a Bloomberg report that a group including BET CEO Scott Mills and CC Capital founder and senior managing director Chinh Chu are considering offering up to $1.7 billion to acquire BET.
Other possible assets on the auction block could include Pluto TV and the famed Paramount lot, which would be leased back for the studio’s use, four individuals familiar with the matter previously confirmed to TheWrap.
Robbins, McCarthy and Cheeks are also advancing talks with potential partners in international markets that will “significantly transform the scale and economics” of its streaming business, which is currently on track to reach domestic profitability in 2025. The Office of the CEO said they could team up with other streamers or technology platforms on a joint venture or long-term partnership. CNBC reported on Monday that Warner Bros. Discovery is interested in a potential merger of Max and Paramount+.
Paramount, which has a market capitalization of $8.14 billion, has seen its stock price fall 17% in the past six months and 28% in the past year.
The post Paramount Stock Climbs 7% as Skydance Deal Looms appeared first on TheWrap.
